2018 UEM Edgenta Annual Report

AUDIT AND RISK COMMITTEE REPORT The Audit and Risk Committee assists the Board in its oversight of the Company’s financial reporting, and in fulfilling its fiduciary responsibilities relating to internal controls. This includes risk management, maintenance of financial and accounting records and setting policies as well as financial reporting practices of the Group. It also reviews related party transactions and conflict of interest situations that may arise within the Group. COMPOSITION The ARC consists of three (3) members, all of whom are Non-Executive Directors, with a majority of them being Independent Directors. This complies with Paragraph 15.09(1)(a) and (b) of the Main Market Listing Requirements (“Listing Requirements”) of Bursa Malaysia Securities Berhad (“Bursa Securities”). The ARC Chairman, Mr. Robert Tan Bun Poo, is a member of the Malaysian Institute of Accountants (MIA) and the Malaysian Institute of Certified Public Accountants. With two (2) ARC members being members of the Malaysian Institute of Accountants, the Company meets the requirement of Paragraph 15.09(1)(c)(i) of the Listing Requirements. The members of ARC are as follows:- Name of ARC Members Directorship Robert Tan Bun Poo*^ (Chairman) Independent Non-Executive Director Elakumari Kantilal* Non-Independent Non-Executive Director Emily Kok (Appointed on 1 June 2018) Independent Non-Executive Director Dr. Saman @ Saimy Ismail (Resigned on 1 June 2018) Independent Non-Executive Director * Member of the Malaysian Institute of Accountants ^ Member of the Malaysian Institute of Certified Public Accountants MEETINGS A total of six (6) meetings were held during the financial year ended 31 December 2018 and the attendance of the ARC members are as follows:- Name of ARC Members No. of meetings attended Robert Tan Bun Poo (Chairman) 6/6 Elakumari Kantilal 6/6 Emily Kok (Appointed on 1 June 2018) 2/2 Dr. Saman @ Saimy Ismail (Resigned on 1 June 2018) 4/4 SUMMARY OF WORK OF THE ARC During the year, the Chairman of ARC met the Head of Risk Management and Head of Internal Audit regularly, including pre-meeting discussions of their activities and reports. In line with the terms of reference of the ARC, the following works were carried out by the ARC during the financial year ended 31 December 2018:- A. FINANCIAL STATEMENTS AND CORPORATE GOVERNANCE 1. Reviewed the quarterly and annual financial statements of the Company and of the Group; and recommended them for Board’s approval, focusing particularly on:- a) appropriateness and relevance of accounting policies and practices adopted and their application; b) any significant non-recurrent or unusual year-end transactions made or events occurred during the year; c) any significant changes to the basis of preparation of the financial statements or new accounting standards adopted during the year which impacted the result or financial position of the Group; d) the going concern assumption used in the preparation of the financial statement; e) significant accounting matters highlighted which included financial reporting issues, estimates or judgements made by Management, unusual events or transactions, and how these matters are addressed; and f) compliance with financial reporting standards and other regulatory requirements. 2. Reviewed non-recurrent and recurrent related party transactions of a revenue or trading nature which are necessary for the day-to-day operations in the ordinary course of business of the Company and its subsidiaries to ascertain as to whether they are undertaken on an arm’s length basis on normal commercial terms not more favourable to the related parties than those generally available to the public or those extended to unrelated parties and are not detrimental to the minority shareholders. 3. Reviewed the Circular to Shareholders in respect of the proposed shareholders’ mandate for recurrent related party transactions and proposed new mandate for additional recurrent related party transactions of a revenue or trading nature. 4. Reviewed and recommended the Corporate Governance Overview Statement, Corporate Governance Report and ARC Report, to the Board for its approval. 5. Reviewed the Terms of Reference of the ARC to reflect the changes of the Malaysian Code on Corporate Governance issued by Securities Commission of Malaysia and Listing Requirements issued by Bursa Securities, and subsequently recommend to the Board for approval. THE BOARD IS PLEASED TO PRESENT THE AUDIT AND RISK COMMITTEE (“ARC”) REPORT WHICH PROVIDES INSIGHTS ON HOW THE ARC DISCHARGE ITS FUNCTION AND DUTIES FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2018. Management Discussion & Analysis UEM Edgenta Berhad Annual Report 2018 About UEM Edgenta Chairman’s Statement 126